Vietnam steel industry decries new US duties

Steel coils at the Vina Kyoei Steel Co Ltd’s production plant in the southern province of Ba Ria–Vung Tau (Source:VNA)

Hanoi (VNS/VNA) - The Vietnam Steel Association (VSA) will coordinate
with the Ministry of Industry and Trade to protect the legitimate rights and
interests of local steelmakers who were recently accused of tax evasion by the
US Department of Commerce (DOC).

The decision, made by the DOC last week, would involve the imposition of
anti-dumping measures and anti-subsidy rates on corrosion-resistant (CORE) and
cold-rolled steel from Vietnam.

In 2016, US steelmakers succeeded in persuading the DOC to impose anti-dumping
(AD) and countervail (CV) duties on Chinese steel, which meant cold-rolled
steel from China would be subject to 265.79 percent AD and 256.44 percent CV
duties when exported to the US.

AD and CV duties of 199.46 percent and 39.05 percent, respectively, were
applied to corrosion-resistant steel from China.

DOC argued that Chinese products are being dumped in third-party countries,
such as Vietnam, to circumvent these duties, leading to last week’s decision.

Although the product was only processed in Vietnam, the commerce department
agreed with the claims of American producers that as much as 90 per cent of the
product’s value originated from China.

Following the case, VSA said it was working with the Department of Trade
Defence under the Ministry of Industry and Trade to follow developments
relating to the ruling and to take the necessary measures in defense of local
steelmakers in accordance with World Trade Organisation (WTO) regulations.

According to the VSA, the process of making corrosion-resistant or cold-rolled
steel by Vietnamese businesses is a crucial step in the closed-loop
manufacturing of high-quality flat steel bars, with factories in Vietnam receiving
investment to the tune of hundreds of millions of US dollars.

The cold-rolling process generates between 30 and 40 percent added value to
imported hot-rolled coil from China, the VSA argues, dismissing the claim by US
authorities that the vast majority of the value of Vietnamese steel originates
in China.

In addition, the association said, the US had yet to put a regulation in place
regarding the required added value content of exports from Vietnam, making it
difficult for Vietnamese steelmakers affected by the decision to respond.

In a release on its website, DOC said importers and exporters of Vietnamese
merchandise that is produced from substrate originating in Vietnam or a third
country have the option of seeking an exemption from cash deposits by
certifying that the substrate originated outside of China.

DOC statistics showed that shipments of CORE from Vietnam to the US increased
from 2 million USD to 80 million USD after preliminary duties were imposed on
Chinese products in 2015.

Likewise, shipments of cold-rolled steel from Vietnam to the US climbed from 9
million USD to 215 million USD after the duties were imposed.

DOC is currently scheduled to announce its final determinations in these
inquiries on February 16, 2018.

The case was initiated in September when US steel producers, including
ArcelorMittal USA, Nucor Corp, AK Steel Holdings Corp and Steel Corp, filed
lawsuits in which they claimed Chinese steel producers shipped products via Việt
Nam to evade tariffs.

In November, the European Union’s anti-fraud office said it found Chinese steel
was shipped through Vietnam to evade the bloc’s tariffs.-VNA